Germany’s New Coalition Government Agrees to Phase Out Coal, but Will Miss 2020 Emissions Targets

Germany’s Social Democratic Party (SPD) members agreed to join their longtime rival and governing partner, the Christian Democratic Union (CDU), and reluctantly entered into a third grand coalition government on March 4. While this ended months of anxious handwringing following September’s national elections, the entire process was mired in frustration as the prospect of yet another coalition grew more unpopular each day.

While the only idea more unfavorable was another national election (with the fear that rightwing parties would gain even more support), at the ceremony announcing the SPD’s decision to again join the CDU, there was virtually no applause. Much like a resigned patient about to undergo chemotherapy, the general mood among both SPD and CDU party members (and the general population) was one of begrudging willingness without any marked enthusiasm. Following years of coalition experience behind them, neither party seemed excited to rejoin the partnership and, its fair to say, the new ruling coalition is both weaker and more unpopular now than prior to elections.

Energy Transition Hitches

While the new agreement is long on promises and short on specifics, what remains certain is only that Germany will miss its greenhouse gas emissions targets for 2020—an embarrassing stumble for this economic powerhouse, once cited by many as a model for how to address climate change. Perhaps as a way to mitigate this embarrassment, the new coalition agreement pledges to expand renewable production to fully 65% by 2030.

Over the past decade, Germany’s Energiewende, the simultaneous action of phasing out nuclear power and switching from fossil to renewable energy sources, has guided the nation to generate a remarkable amount of green energy. However, this has happened largely without a reduction in overall greenhouse gas emissions. Currently between 33% and 38% is regularly produced by renewables, with over 60% still being generated by fossil fuels—mostly coal.

Disappointingly, environmental and energy policy only makes up about 10 pages of the overall 179-page coalition agreement. It’s partially this that led to the rather surprise decision by the country’s current Secretary of State in the Federal Ministry of Economics, Rainer Baake, nicknamed by many “Mr. Energiewende” because of his role in developing the policy, to retire in protest after occupying the position since 2014. A member of the Green Party, he claimed the new agreement was “a bitter disappointment for the Energiewende and climate protection,” calling it “much too hesitant” on renewable energy policies.

Going forward, CDU member Peter Altmaier, a former environmental minister, is set to take his place as point person on the Energiewende. This is a post that from 2012 to 2013 Altmaier briefly occupied. During that time, he proposed retroactive changes to Germany’s renewable energy feed-in-tariff (FiT) system, a move that negatively impacted investment security in offshore wind and led to a slump in the energy sector. Though the shift from a FiT system to an auction-based one has since been adopted, Altamaier’s unpopular ideas at the time were publicly rejected by Chancellor Merkel.

Coal Exit Promised

Exit PromisedOne of the few announced specifics of the deal is the promise of an eventual coal exit. “We will set an end date for coal-fired power production, both for hard coal and lignite,” SPD energy spokesperson Bernd Westphal told the Clean Energy Wire shortly after the agreement was announced. He said a special commission consisting of representatives of the affected industries, labor unions, federal states, local authorities, and environmental organizations would soon be organized in order to present its results by the end of this year. Stating that Germany will “absolutely” come up with an end date for coal in early 2019, the promised coal exit plan will include a “gradual reduction and phase-out of coal-fired power production, including an end date, and the necessary accompanying legal, economic, social, and structural policy measures.” This will also include financial support for the necessary structural changes in affected regions.

Additionally, the new agreement pledges a continued commitment to “national, European, and Paris Climate Agreement climate protection goals for 2020, 2030, and 2050 for all sectors.” It also promises to continue working towards becoming largely greenhouse gas neutral “no later than in the second half of the century.” But the national target of reducing emissions by 40% by 2020 compared to 1990 levels has been watered down to lowering emissions by “as much as possible, as fast as possible” while adhering to an internationally binding 2030 target of reducing emissions by 55% to be reached “by all means.”

Above all, the Grand Coalition has pledged to continue with the “goal-oriented and efficient expansion of renewable energy sources that is synchronized with grid capacity and increasingly geared towards market mechanisms.” Promising to “substantially increase” the renewables expansion to cover additional power demand in the transport, construction, and industry sectors, the Energy Ministry will eventually create an “ambitious plan containing measures to optimize existing grid infrastructure and accelerate expansion.”

While Germany continues to phase out both nuclear and coal, natural gas will remain a baseload and backup fuel. The plan calls for the further development of liquefied natural gas infrastructure as an alternative to piped-in gas.